(Reuters) - Oil refiner Valero Energy Corp (VLO.N) reported a higher-than-expected quarterly profit, supported by lower crude costs and healthy demand for gasoline in the United States.
U.S. refiners have been pumping out strong profits due to high crack spreads, the difference between the price of crude oil and refined products. Crude prices have fallen more than 70 percent since June 2014.
On an adjusted basis, Valero reported earnings of $1.79 per share for the fourth quarter ended Dec. 31, beating the average analyst estimate of $1.45 per share, according to Thomson Reuters I/B/E/S.
Valero’s refining margin fell to $10.87 per barrel in the quarter from $11.17 per barrel a year earlier.
Net income attributable to Valero’s stockholders fell to $298 million, or 62 cents per share, for the fourth quarter ended Dec. 31, from $1.16 billion, or $2.22 per share, a year earlier.
The company incurred a inventory valuation adjustment charge of $790 million.
Operating revenue fell 33 percent to $18.78 billion.
Reporting by Amrutha Gayathri in Bengaluru; Editing by Saumyadeb Chakrabarty and Robin Paxton